How to pay down debt when you’re on a fixed income
Debt can be tough to handle no matter your age. Having debt and being on a fixed income can make it even more difficult. And according to a new report, retirees struggle with debt just like any other population. A recent study of retirees found that 76 percent had some form of debt, and 67 percent carried credit card debt that wasn’t paid off. Here are some ways retirees can pay down their debt faster.
It might not be the most exciting idea, but one way to get out of debt faster is to find part-time work. Getting a job during retirement will allow you to temporarily boost your income and funnel all of those earnings toward paying down your debt. Now is also a great time to try this strategy, as many companies are open to remote workers.
Use a Card
If you have credit card debt, you might want to seek out a balance transfer card. You want to find a card with a zero percent introductory rate. Then you transfer your high interest debt onto that card and pay down the debt without getting crushed by that interest. Just watch out that the balance transfer fees involved don’t eat up all the money you save.
If you own a home, you may have a lot of equity built up. As USA Today suggests, you could take out a home equity line of credit (HELOC) to pay down your credit cards. A HELOC often has lower interest rates than credit cards. However, be smart about a HELOC. Make sure you can make the payments on the loan, because if you don’t, you could end up losing your home. That’s why a HELOC might be best as a last resort.
Blog Written by Chris O'Shea from SavveyMoney